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Wednesday, June 9th, 2010 - 6 comments

How are communities affected when women control their own investments?

Please welcome Juke Carolina Rumuat who will be live-blogging about this topic all week. Please share your projects, links and experiences in the box above. Conversations for a Better World have dedicated the entire week to female entrepreneurship, courage and investments. Show us best practices. We want to hear about women who are building schools and spearheading micro-credit projects. Planting and harvesting crops. Buying and selling goods. Setting up small businesses and doing it for themselves and their communities. To kick-start the conversation, Juke Carolina Rumuat explores cases from Indonesia. Please read below.


Flickr-photo "Scale" by deepchi1

Flickr-photo "Scale" by deepchi1

Indonesia managed to weather the latest economic crisis and is now even a contender for the BRIC nations. What exactly was the secret of the world’s most populous Muslim-majority nation? More than half of Indonesia’s 230 million people are women.

The majority of Indonesian women still adhere to their principal societal roles of being a wife and becoming mother. Although the trend is changing, most of the time women are still not included in decision-making nor are they demanded to contribute to the family’s well being; working is an option but not compulsory – thus financial independence is not absolute.

In the villages, parents marry off their daughters in hopes of securing their future. This practice leads many women poorly educated and left with few options in life. Women are often classified as “unskilled laborers” – working in the factories or sent abroad to work as maids – but their contributions to the state’s coffers have been overlooked and their rights haven’t been properly acknowledged.

In the past years, Indonesian women have inspired one another and showed that they too can ace in areas mostly governed by their male counterparts. One of Indonesia’s inspirational women is the former Finance Minister Sri Mulyani Indrawati, who is currently the Managing Director of the World Bank.

A 2008 report published by the Indonesian Bureau of Statistics said that there are 46-49 million Micro, Small and Medium Enterprises (MSME) in Indonesia, and 60_80% of them are owned by women. Those MSMEs represent 97.1% of the country’s labor force.

Similar to women in Africa or South Asia, Indonesian women also face challenges, like taking a bank loan without male guarantor, or if they fail to demonstrate that they are creditworthy.

Fortunately women do stick together in this country, and a strong presence of camaraderie among women can be felt in rural or urban communities.

On his blog, Son Haji Ujaji [id], an activist based in Tangerang, West Java, highlights how women have the capacities to increase the family’s income [translation]:

Women are, by nature, highly sociable and they will take active roles in order to improve the household income. Local activities are better to be managed by women. Culturally, the Indonesian women have a strong understanding about the importance of community, this reflect in many communal programs such as PKK (author’s note: courses for housewives, including sewing, gardening, first aid, etc.), Posyandu (author’s note: community health center), and arisan (author’s note: private betting, strictly among friends and family) that still exist today.


PKK currently prioritizes Income Improvement Program (UP2K-PKK). […] The program, which highlights women’s potentials, their will power and characters, made itself a primary definition of social safety net, a way to help the people from poverty and empower them to be a strong and independent individuals as well as family unit.

Generating income online and offline

Koperasi (cooperatives), a business institution founded by a group of people, governed democratically and aimed for mutual benefits, is regarded as one of the cornerstones of Indonesian economy.

Over the years, the basic principles of Koperasi are pretty much ingrained in the people’s mind. Although Multi Level Marketing (MLM), doesn’t have identical values as Koperasi in acknowledging the importance of community and network, it is also considered as a great way to generate alternative incomes. People don’t necessarily go to MLM meetings to buy; they come to network, to find new opportunities or business partners over gossip, tea and cakes.

After presentations and catalogues for MLM came blogs and Facebook. The ladies quickly found a new place to market their crafts, imported Korean sundresses, or even last season’s Jimmy Choo heels and other luxury goods at discounted prices. Generating extra income is becoming as easy as tagging pictures.

Does microcredit work in Indonesia?

Microcredit, in practice, is not always a silver bullet against poverty in Indonesia, on the other hand new jobs would be.

International micro-credit organizations like Kiva aim to empower impoverished women and their communities through lending; this, however is not a simple task.

A netter nicknamed salman_taufik made a comment on a post appeared on Stanford Social Innovation Review. He has an excellent insight about why micro-finance is not quite a success story in Indonesia:

I have similar finding in macro level for Indonesian cases. During last decade after crisis 1988 – 2009, poverty only slightly downed from 21% into 14.15% by 2009, despite controversy over this statistic. Meanwhile, the credit growth into micro entrepreneurs increase 7 times during 2000-2009, much more higher than overall banking industry which only twice for the same periods. Contrasting of both figures bring me into question the effectiveness of microfinance to alleviate poverty. Since some the credit flows into micro entrepreneurs are consumer loans, I suspect that the rapid growth just showed how success capitalism sell their consumer goods into the poor such motor cycle, cellular phone, home appliances, etc, and the poor sell their land and cut illegal tree to pay all those stuffs. Furthermore, even though micro finance give access for poor people to have capital or liquidity but they have to pay almost twice than corporation. I just think that there have been money slavery over the poor. So somehow I agree with you unless they don’t charge the money, let it as working capital to save their lives.

In a country where many still earn less than US$ 2 a day, foreign financial aid is often misunderstood by poor communities.

Anna Antoni, a Kiva fellow based in Bali explains:

The fear of the Kiva field partner where I serve was if borrowers know that their loan comes from abroad, they will think it is charity. They will not feel obliged to pay back their loan and it will cause long term problems even if the loss is not covered by the field partner. There is a damage industrialized countries have made through aid that goes far beyond support in crises, taking away something from a spirit of “I can do this- I can handle the challenges in my life!” which is so important in microfinance… but back to transparency.


The whole process showed again how big the influence of Kiva can be. For most developing countries it is a shift of paradigm not to receive funds that either don’t have to be repaid or be repaid under heavy conditions. Putting a lot of effort into raising the transparency for borrowers and thus showing respect to all people participating in the mission of Kiva is more than important. Besides fulfilling the value of microfinance to help people to help themselves, it is the basis for a new approach to development.

Indonesian female entrepreneurship is an interesting fact. Unfortunately the fact seems to have gone unnoticed by local netters as this author (me!) struggled to find blog posts that include testimonies or opinions about the unsung economic heroines. Have I missed some great stories published on the net? If so, please let me know. Your links, opinions, and insights are highly appreciated.

The views expressed in this blog-post are solely those of the author.

Comments (6)

Tweets that mention How are communities affected when women control their own investments? – Conversations for a Better World --
Thursday 10th June, 2010, 1:52pm

[...] This post was mentioned on Twitter by Sadee M. Kartakusuma and GV Indonesia, Cash 2 Keep. Cash 2 Keep said: How are communities affected when women control their own ... [...]

Global Voices на македонски » Индонезија: Кога жените сами си ги контролираат инвестициите
Friday 2nd July, 2010, 6:16am

[...] пост исто така е објавен и на Конверзации за подобар свет на UNFPA каде што  Каролина ќе води блог за женскиот [...]

Global Voices teny Malagasy » Indonezia: Rehefa ny vehivavy no mifehy ny fampiasam-bolany
Wednesday 14th July, 2010, 5:12am

[...] ihany koa ity lahatsoratra ity ao amin'ny ao amin'ny Resadresaka Hanatsarana ny Tany an'ny UNFPA izay ahitana an’i Carolina mampiaina ny live-blog [...]

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Guest Editor

Juke Carolina

Freelance writer and translator, Global Voices Online


Hi! I'm Global Voices Author, Editor for its Lingua Bahasa Indonesia project, and an all-round Social Media bunny. A language enthusiast who's currently based in Morocco's economic lungs enjoying the sun and great food :-).

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